Our website uses cookies to improve your user experience. If you continue browsing, we assume that you consent to our use of cookies. More information can be found in our Cookies Policy and Privacy Policy.

Rethinking Armstrong’s move to AOL

Hit “reset” and forget everything you’ve read about Tim Armstrong leaving Google for AOL. Take a leap of faith and believe he was not brought in to take the company public on its own, or paint this house and then sell it to another media company. Armstrong at AOL makes sense on many levels. From TimeWarner CEO Jeff Bewkes’ point of view, this is a logical hire to keep AOL within the company and connect its fate to TimeWarner’s myriad content brands.

Bewkes has been through a few top dogs at AOL. One, Jon Miller, came in with a very impressive resume on the ecommerce and entertainment content lines. His strategy did not drive revenue. Now Bewkes is looking at a company that has media assets occupying very different stages of their lifecycles. Movies and cable are still prime. One of the most troubling assets is a huge stack of print magazines of varying profitability and viability. Sports Illustrated, Entertainment Weekly, and even the flagship Time have had a tough time maintaining readership and revenue. Readers have moved online, but TW has cut too many deals to make the internet a value-add for print sales. Revenue migration has lagged.

Bewkes and predecessor Dick Parsons, have made some improvements to AOL sales capabilities that should have driven more revenue than they have. It still maintains a search technology and placement agreement with Google, for example. It bought Platform-A and integrated Tacoda to solidify its ad network and targeting capabilties. But these have not worked to satisfaction because sales executives for the individual brands still need to control key intertnet ad placements and to an extent, be accountable for the revenue. Integrating Platform-A has been tough. Armstrong, with his knowledge of Google’s technology, key clients, and partnerships is a good match for these challenges. His knowledge of internet advertising, and the new Platform-A leadership of ex-Yahoo Greg Coleman, is a plus.

Armstrong should have the knowledge and skill to give AOL one last run as a TW brand. If Bewkes wanted to have a hotshot executive that was palatable to a potential buyer, he would have reached into Fox’s recent talent pool castoffs such as Peter Chernin or Chase Carey. If Bewkes wanted a sale of AOL as the outcome here, he would have sold it already. What he paid for here is a good blend of cutting-edge technology and old media salesmanship.

From Armstrong’s point of view, why would you take this gig to become a highly-paid virtual real estate agent? Armstrong will find a way to re-brand AOL. He will hire someone to help him with that. His main mission will be to weld AOL’s user base with TimeWarner’s reader base. There are a lot of big numbers on both sides of that equation.

And Jeff Bewkes keeps two monsters at bay. One is the stock market that isn’t exactly primed for an AOL IPO. The other monster is the board member who asks the very relevant question, “who would you sell AOL to anyway?”

Recommended

I signed up for Twitter at the beginning of the year and even though I’m not a hardcore user and only have a modest ‘following‘ of around 225 people, I do like the service. I’ve found it to be very useful in staying on top of industry trends and seeing what interesting people are talking about.

The world’s biggest companies are failing at more than their profit performance these days. A new report from SEO measurement company Conductor finds that organic search results from the Fortune 500 would hardly rate a good MBA project. In fact, the report says “as a whole, the group is still doing a very poor job of ensuring that their ‘money’ keywords are represented in natural search.” It found that only 20.82 percent of Fortune 500 keywords rank within the top 100 search results, as measured during the fourth quarter of 2008.

The lesson Fortune 500 companies are learning is that paid search buys exactly that: paid results. The Fortune 500 as a group spent approximately $51 million per day on 88,792 keywords with relatively little to show on organic results, according to the report. And many of those keywords were consolidated in a few industry verticals and in a handful of companies.

The blogosphere has changed. The euphoria that marked the rise of the
blogosphere has been muted by reality (also known as the global economic meltdown). The passion
that characterized the most prominent bloggers has given way to the
problems that characterize “success.”

Even I’m disappointed in the
changes that have taken place in the blogosphere, despite the fact that my role as a D-list contrarian blogger was to point out the inevitable bust that was coming.

Twitter has many uses for our business beyond sending us traffic and spreading word about our articles, research and events.

While it is now our fourth-largest referrer, Twitter is more than simply a people hose. By tuning in to tweets we listen to user feedback, which helps keep us on our toes. It is useful in a wide number of areas, some of which I have listed below.

Some recommendations and questions are easier to deal with than others, but we certainly take note of all of them.

Latest

Nike’s latest flagship store has arrived on New York’s Fifth Avenue, and with it comes a glimpse into the future of retail. An oft-trotted expression maybe, but the ‘Nike House of Innovation 000’ (its official title) is deserving.